Consumer confidence in U.S. rose more than forecast in February

The number of respondents who said jobs are currently plentiful advanced to 10.5% in February from 8.5%. The share saying jobs are hard to get rose to 37% from 36.6%.

Buying plans were more mixed. The share forecasting they will purchase a car climbed, while intentions to buy a house or major appliances fell.

Today’s figures match other measures of consumer confidence. The Bloomberg Consumer Comfort Index’s weekly gauge rose in the week ended Feb. 17 to its highest level this year, though the gap between positive and negative expectations was little changed this month.

The Thomson Reuters/University of Michigan preliminary index of consumer sentiment rose in February to its highest level in three months.

Employment gains could help to sustain demand, giving consumers more money to spend. Employers hired a net 157,000 workers last month following gains of 196,000 and 247,000 in December and November, Labor Department figures show.

Job Gains

“Employment growth, while subpar compare to economic recoveries, has shown more recent signs of an improving pace of pickup,” said Jon E. Bortz, Chief Executive Officer of Pebblebrook Hotel Trust, in a fourth quarter earnings call on Feb. 22. The company invests in hotel properties located in large U.S. cities, particularly in coastal markets. “Both consumer confidence and business confidence have also been improving recently. So, all of these seem to bode well for at least a modest year of demand growth in 2013.”

Still, headwinds remain. A decrease in take-home pay from a higher payroll tax had been dragging down consumer confidence. Americans earning $50,000 a year are taking home about $80 less a month after the tax used to pay for Social Security benefits increased to 6.2% from 4.2% starting last month.

Rising retail fuel prices are also costing consumers. After falling as low as $3.22 in December, a gallon of regular unleaded gasoline at the pump now is hovering close to $3.80, according to AAA, the U.S.’ largest auto group.

Discretionary Spending

As consumers try to adjust to smaller disposable incomes, spending on goods and services -- such as restaurant dining -- could slow.

“There are still some lingering political issues such as the sequestration that we believe are creating uncertainty in the marketplace,” Elizabeth A. Smith, chief executive officer of Bloomin’ Brands Inc., said in a Feb. 22 earnings call. Bloomin’ Brands owns casual dining chains including Outback Steakhouse and Carrabba’s Italian Grill. “Housing indicators are showing signs of improvement, but gas prices now seem to be rising. In addition, the payroll tax increase and inflation and other categories represent real headwinds for consumer disposable income.”